‘Great Expectations’: The National Industrial Court and its Prospects of Furthering Social Rights in Nigeria

by | May 19, 2020 | ANUL, ANUL 2019 I1

‘Great Expectations’: The National Industrial Court and its Prospects of Furthering Social Rights in Nigeria

Authors Nsongurua Udombana & Ngozi Udombana

ISSN: 2521-2613 Affiliations: Source: Africa Nazarene University Law Journal, 2019, Issue 1, p. 86 – 114

Abstract

The Nigeria Constitution 1999 makes the application of treaties contingent on their domestic transformation through a legislative enactment. This requirement, coupled with the question of justiciability, poses challenges to the judicial interpretation and application of economic and social rights, in particular. A recent amendment to the Constitution permits the National Industrial Court (NIC) to interpret and apply labour rights guaranteed in treaties, though they may not have been transformed into municipal law. Working on the premise that courts have a critical role to play in realising social rights, we argue that this development gives the NIC a rare opportunity to advance social rights. We call on NIC judges to boldly deploy their enhanced mandate to interpret the relevant labour-related treaties in ways that advance social rights in Nigeria.

The Dilemma of Electricity Pricing and Cost Recovery in Nigeria: Repositioning the Law to Balance the Interests of Investors and Consumers

by | May 19, 2020 | ANUL, ANUL 2019 I1

The Dilemma of Electricity Pricing and Cost Recovery in Nigeria: Repositioning the Law to Balance the Interests of Investors and Consumers

Authors Uzezi Okpoudhu, Dr Peter Kayode Oniemola & Dr Eddy Lenusira Wifa

ISSN: 2521-2613
Affiliations:
Source: Africa Nazarene University Law Journal, 2019, Issue 1, p. 115 – 137

Abstract

The Nigerian electricity sector has been privatised and is transitioning in a competitive market. The law requires that tariffs should be cost reflective, attractive to investors and affordable to consumers. The challenges of balancing the interests of investors and those of consumers have been a bane to the development of a competitive electricity market. The progress made in the African countries of Tanzania and Kenya is commendable. This article analyses the conflicting interests, and offers solutions on how the law could be employed to balance the interests of investors and consumers in the Nigerian electricity market.

The turquand rule in South African company law: a(nother) suggested solution

The turquand rule in South African company law: a(nother) suggested solution

by | May 12, 2020 | JCCL, JCCL V5 I2

The turquand rule in South African company law: a(nother) suggested solution

Author: Etienne Aubrey Olivier

ISSN: 2521-2575
Affiliations: LLD candidate, University of the Western Cape
Source: Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 2, 2019, p. 1 – 28

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Olivier, EA
The turquand rule in South African company law: a(nother) suggested solution
Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 2, 2019, p. 1 – 28

Abstract

The common-law Turquand rule in South African law protects persons from being affected by a company’s non-compliance with an internal formality pertaining to the authority of its representatives. The Turquand rule should not be regarded as an independent rule of South African company law, but as part of the law of agency, particularly the principles of agency by estoppel. Section 20(7) of the Companies Act 71 of 2008 attempts to protect bona fide third parties dealing with companies. However, this section is likely to create uncertainty as it fails to clarify its impact on other provisions in the Act that prescribe requirements for company decisions. It is argued that s 20(7) of the Act is unnecessary and potentially dangerous, and should be repealed.

A ‘fair and reasonable proposal’ by the board may still amount to a breach of duty to exercise directors’ powers for a proper purpose

by | May 12, 2020 | JCCL, JCCL V5 I2

A ‘fair and reasonable proposal’ by the board may still amount to a breach of duty to exercise directors’ powers for a proper purpose

Authors Tshepo H Mongalo

ISSN: 2521-2575
Affiliations: Associate Professor University of the Witwatersrand, Johannesburg
Source: Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 2, 2019, p. 29 – 43

Abstract

Following the welcome abandonment of the proposal by Africa’s biggest retail chain, Shoprite Holdings Ltd, to buy out Christo Wiese’s high-voting deferred shares at a cost of about R3.3 billion because the proposal received more than 15 per cent of the minority shareholders’ disapproval, the real possibility of breach of duty by the company’s directors if the deal had proceeded has become moot. Using a long-standing legal authority — in the form of the judicial decision in the case of Howard Smith v Ampol Petroleum Ltd [1974] AC 821, and the more recent UK Supreme Court’s judgment in Eclairs Group Ltd v JKX Oil & Gas PLC [2015] UKSC 71 — this article argues that the directors would have found themselves in breach of their fiduciary duty had the deal materialised. This is regardless of the fact that the proposal had ‘allegedly’ been determined as ‘fair and reasonable’ by the auditing and accounting firm of Ernst & Young. Keywords: directors’ duties; proper purpose; fair and reasonable proposal; collateral purpose; multiplicity of purpose; substantial purpose; chairman’s influence.

The role of a legal system in the improvement of a country’s economy in relation to foreign investment

by | May 12, 2020 | JCCL, JCCL V5 I2

The role of a legal system in the improvement of a country’s economy in relation to foreign investment

Authors Princess Pat. Ada Ajudua

ISSN: 2521-2575
Affiliations: Legislator, Delta State House of Assembly, Asaba, Nigeria
Source: Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 2, 2019, p. 44 – 56

Abstract

This paper examines the role of a legal system in the improvement of a country’s economy in relation to foreign investment. The study has adopted a descriptive and analytical design, using a doctrinal methodology. It analyses the thematic problem of the investment climate issue in Nigeria, improvement in the mechanism for the resolution of investment arbitrations in Nigeria, and the expropriation in foreign investment and the settlement of investment disputes in Nigeria. Finally, the paper argues that the current wave of globalisation sweeping through the world has intensified the competition for FDI among developing countries. Consequently, concerted efforts are needed at national, regional, and international levels in order to attract significant investment flows to Nigeria and improve the prospects for sustained growth and development.

SARS’s application of the additional medical scheme fees tax credit for prescribed expenditure: a rule of Law violation?

by | May 12, 2020 | JCCL, JCCL V5 I2

SARS’s application of the additional medical scheme fees tax credit for prescribed expenditure: a rule of Law violation?

Authors Fareed Moosa

ISSN: 2521-2575
Affiliations: Head of Department (Mercantile and Labour Law) University of the Western Cape
Source: Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 2, 2019, p. 57 – 78

Abstract

Tax administration by the South African Revenue Service (SARS) is subject to constitutional control. As such, all SARS’s administrative processes must adhere to the rule of law, a founding constitutional value. This article argues that certainty, fairness, legality and rationality are basic principles of this value that must underpin SARS’s application of the rules governing the assessment of a taxpayer’s claim to benefit from the additional medical scheme fees tax credit provided for in s 6B(2) of the Income Tax Act 58 of 1962. This article shows that, in practice, SARS uses its examples of ‘qualifying medical expenses’ as legal yardsticks for determining whether a tax credit ought to be granted. The nub of this article is its hypothesis that this practice is antithetical to the principles engrained in the rule of law and, as such, does not pass muster. Consequently, the key contention made here is that any disallowance of a rebate on the basis that a taxpayer failed to satisfy any requirement in a listed example is justifiable grounds for an objection and appeal to be lodged under the Tax Administration Act 28 of 2011. Finally, this article argues further that a taxpayer is entitled to a rebate under s 6B(2) read with para (c) of the definition of ‘qualifying medical expenses’ in s 6B(1) of the Income Tax Act if the following two-legged test is met: First, the expense must be ‘prescribed’ by the Commissioner of SARS. Secondly, the expense must be ‘necessarily incurred and paid’ by the taxpayer ‘in consequence of any physical impairment or disability’ that is suffered by the taxpayer personally or by any person qualifying as a ‘dependant’ of the taxpayer.

Taxation, an equitable system and constitutional core values for efficient financial stability in Nigeria

by | May 12, 2020 | JCCL, JCCL V5 I2

Taxation, an equitable system and constitutional core values for efficient financial stability in Nigeria

Authors Kareem Adedokun

ISSN: 2521-2575
Affiliations: Senior Lecturer Kwara State University, Malete
Source: Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 2, 2019, p. 79 – 94

Abstract

Nigeria is a federation consisting of 36 states and a Federal Capital Territory. Each state needs adequate revenue for sustainability and has autonomy to initiate and implement any policy that may promote steady, internally generated revenue within its sphere. But such a policy must align with the overall political objective of the nation, enshrined in the Constitution. The Constitution advocates national integration, residence right and adequate provision for facilities to all citizens, believing that if a system is fair and equal, taxpayers will be more willing to cooperate with it. However, some states of the federation are implementing policies, particularly in education and politics, marred by deep inequalities which affect revenue generation and financial capability of the states. The author, using doctrinal and survey sampling methods, critiques these discriminatory policies and the way in which they interfere with the civic duty of tax obligation. The paper finds that discriminatory practices do not only whittle down revenue generation but also impair national integration. Consequently, it is suggested that various state governments in Nigeria should introduce a tax system that aims at catching many types of income, and ensure judicious application of the tax proceeds for the general and equal benefit of citizens regardless of their places of birth. The suggestion, if accepted and utilised, will enhance revenue generation, promote national integration and ensure delivery of the dividends of democracy to the citizens.

The philosophy of business rescue law

by | May 12, 2020 | JCCL, JCCL V5 I1

The philosophy of business rescue law

Authors Owen Mokoena

ISSN: 2521-2575
Affiliations: PhD Candidate, School of Law, University of the Witwatersrand, Johannesburg
Source: Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 1, 2019, p. 1 – 41

Abstract

It is a requirement that business rescue must provide for the efficient rescue and recovery of financially distressed companies in a manner that balances the rights and interests of all the relevant stakeholders or affected persons. However, is it necessary to balance the interests of all affected persons in order to achieve the objectives of business rescue? Moreover, is it possible to balance the interests of all affected persons during business rescue? To answer these questions, this article specifically evaluates the meaning and the purpose of business rescue. It analyses various theories that set out the philosophy of corporate rescue law and chooses the creditors’ bargain theory and risk-sharing theory. Based on both theories this articles establishes that, given the purpose of business rescue, it is not necessary to balance the conflicting rights and interests of various stakeholders to achieve the objectives of business rescue.

Obliged to release a solvent spouse’s assets during sequestration proceedings?

by | May 12, 2020 | JCCL, JCCL V5 I1

Obliged to release a solvent spouse’s assets during sequestration proceedings?

Authors Clement Marumoagae

ISSN: 2521-2575
Affiliations: Senior Lecturer, School of Law, University of the Witwatersrand
Source: Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 1, 2019, p. 42 – 58

Abstract

This article reflects on the interaction between section 21(1) and section 21(2) of the South African Insolvency Act. Section 21(1) has been subject to controversy relating to whether it enables the trustee to acquire ownership of the assets that constitute the solvent spouse’s estate where spouses married out of community of property have colluded to defraud the insolvent spouse’s creditors. Section 21(2) seems to be intended to ensure that the trustee does not permanently take control of the solvent spouse’s property if the solvent spouse can prove that there was no collusion between the spouses and that he or she has valid title to any property that vested in the trustee due to the sequestration of the insolvent spouse. Through selected cases, this article demonstrates that the trustees of an insolvent spouses’ estates, in their quest to maximise the benefits, that should be derived by the insolvent spouses’ creditors, usually refuse to release assets that belong to the solvent spouses on the basis that spouses married out of community of property have colluded. This article interrogates the concept of collusion when the solvent spouses’ assets have vested in the trustees of the insolvent spouses’ estate. Furthermore, it argues that solvent spouse who has benefited from the financial assistance of his or her insolvent spouse, at the time when the insolvent spouse had not been insolvent, should not be punished for that assistance when the insolvent spouse is later sequestrated.

The obligation imposed on the board of directors of a company in respect of the solvency and liquidity test under section 4 of the companies act 71 of 2008

by | May 12, 2020 | JCCL, JCCL V5 I1

The obligation imposed on the board of directors of a company in respect of the solvency and liquidity test under section 4 of the companies act 71 of 2008

Authors Simphiwe S Bidie

ISSN: 2521-2575
Affiliations: Lecturer, Nelson R Mandela School of Law, University of Fort Hare
Source: Journal of Corporate and Commercial Law & Practice, Volume 5 Issue 1, 2019, p. 59– 102

Abstract

The solvency and liquidity test in section 4 of the 2008 Companies Act of South Africa is the foundation upon which the entire Act is structured. It sets the threshold against which the ability of a company to distribute its money or property to its shareholders should be assessed. The introduction of the test places the 2008 Act among some of the most progressive and liberal legislative frameworks in the world. The test caters for various interests rather than the orthodox approach of the capital protection principle. The inclusion of the test into South African company law signifies a shift away from the traditional capital maintenance doctrine and recognises other factors that play a role in the economy of the country. From a policy perspective, replacing the capital protection rules with the solvency and liquidity test was a commendable step. The nature and extent of the obligation imposed on directors as a result of the incorporation of the test into the 2008 Act is enormous. The solvency and liquidity test is assessed alongside the duties to which directors must adhere. The discussion of the test and its constituent elements indicates the appropriate standard expected, and the interpretation and application of the test as contemplated in the Act.